- GBP/JPY caught some fresh bids on Monday amid the heavily offered tone around the JPY.
- The upbeat market mood further undermined the safe-haven JPY and remained supportive.
The GBP/JPY cross was seen hovering near the top end of its daily trading range, with bulls now looking to extend the momentum further beyond the 141.00 round-figure mark.
The cross managed to regain some positive traction on the first day of a new trading week and built n the previous session’s intraday rebound from the key 140.00 psychological mark. The uptick was sponsored by the heavily offered tone surrounding the Japanese yen.
As investors looked past the latest political development in Japan, the better-than-expected Chinese PMI prints for August boosted investors’ confidence. This, in turn, undermined the safe-haven Japanese yen and assisted the GBP/JPY cross to catch some fresh bids.
On the other hand, the British pound was seen consolidating its recent strong gains. A subdued/range-bound GBP price action failed to impress bullish traders, or provide any meaningful impetus to the GBP/JPY cross, capping any strong gains, at least for now.
Given that the recent move up was unaffected by concerns about the lack of progress in Brexit talks, the near-term bias remains tilted in favour of bullish traders. However, a bank holiday in the UK might hold investors from placing any aggressive bullish bets.
Hence, it will be prudent to wait for some strong follow-through buying, possibly beyond the previous session’s swing high near the 141.60 region, before positioning for an extension of a two-month-old bullish trend.
Technical levels to watch
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